U.S. Equity Markets Stocks closed positive on Wednesday with outperformance in the NASDAQ 100 while the Russell 2000 again underperformed. The Nasdaq was supported by gains in Tech, Consumer Discretionary and Communication names, the outperforming sectors, while Energy, Materials and Financials lagged. Tech was buoyed by the strong Salesforce (CRM) and Marvell (MRVL) earnings after-hours on Tuesday. T-notes were bid with upside primarily supported by a big miss on the ISM Services PMI, falling to 52.1, beneath all analyst forecasts. The ADP National Employment saw a slight miss but not enough to change the dial or cause a reshape of expectations for Non-Farm Payrolls tomorrow. Meanwhile, the focus was largely on Fed speak – Fed Chair Powell added little new but he was optimistic on the economy and noted the Fed is on a path to more neutral rates over time, and that the Fed can be cautious in finding the neutral rate. The lack of commentary about the upcoming December meeting leaves us looking at Waller’s commentary earlier in the week, who “leans in favour” of a 25bp cut, but it still depends on the upcoming data before the meeting (NFP, CPI, PPI). 2025 Voter Musalem also spoke, noting they can pause at upcoming meetings but he is waiting for the data to make his mind up and is keeping all options open. In FX, the Dollar was flat with outperformance in Cable despite dovish rate guidance from the Bank of England’s Bailey, who sees four 25bps rate cuts in 2025, which took Cable to lows before paring after strong UK Services PMI data while the Dollar weakness post-ISM also lifted the pair to outperform. The Japanese Yen underperformed however but was off its worst levels in the wake of the ISM data. The Australian Dollar lagged after weak GDP numbers. The Euro was ultimately flat while French PM Barnier lost the vote of no confidence, as expected. Crude prices saw notable selling pressure with only a fleeting upside seen after a larger-than-expected draw. There was sharp downside in crude with little explanation, but Reuters sources reported a bank sold USD 270 million of US oil futures ahead of the OPEC+ meeting. Regarding the upcoming meeting, one Reuters source suggested that OPEC+ could even extend production cuts as far out as six months, but another source said this is unlikely – expectations are for a 3-month extension. Bitcoin rose above USD 103K overnight and has held these gains as I go to press after US President-elect Trump named crypto friend Paul Atkins as SEC chair. ISM Services PMI for November fell short of all expectations and even outside the bottom end of the consensus range, as the headline fell to 52.1 from 56.0 (exp. 55.5). Within the report, prices paid ticked marginally higher to 58.2 from 58.1 while business activity dipped to 53.7 from 57.2. New orders (53.7 from 57.4), Employment (51.5 from 53.0), Backlog, and Supplier Deliveries all declined, with the latter falling into contractionary territory. Inventories also tumbled beneath 50.0. Within some of the respondents’ comments, some continue to highlight the uncertainty of tariffs while another said, “Even though we are reducing our spending and our employment levels, we have a positive outlook for 2025 performance with expected reinvestment of funds”. Overall, Oxford Economics notes despite the downside surprise the index still signals expansion in the sector and comments from survey panelists painted a far more optimistic picture. Ahead, the result does not influence our outlook for continued expansion in consumer spending, particularly on the services side, which will keep the economy humming along. Fed Chair Powell said little new, largely leaving us to look back at Waller’s comments for final guidance before the Fed blackout. Fed Chair Powell did not speak on the December meeting, but he did speak up about the economy, stating unemployment is still very low and the Fed is making progress on inflation, albeit they are not quite there yet on inflation. He said the economy is in good shape and there is no reason that it cannot continue. He added that the Fed is on a path to more neutral rates over time, though downside risks are less than thought, and the Fed can afford to be cautious in finding neutral. Elsewhere, Oil closed 1.69% lower while Gold was quiet, closing higher by 0.2%.
To mark my 3100th issue of TraderNoble Daily Commentary I am offering a special 2-Year rate of Euro 2750 for my Platinum Service which includes 1 monthly subscription over the same period would cost 4440 euro in total This offer represents a 38% discount and is open to both new and existing members. If anyone is interested in this offer can you please email me on bryan@tradernoble.com for details
For anyone following my Platinum Service it was made 10 points yesterday and is now ahead by 104 points for December after closing November with a gain of 3049 points having finished October with a gain of 2179 points. September saw a gain of 4402 points following a 301-point loss for August after closing July with a gain of 1918 points while June closed with a gain of 2074 points, having made 1843 points in May. The Platinum Service made 4010 points in April after ending March with a gain of 2113 points. February closed with a gain of 1606 points, after closing January with a gain of 3675 points. December saw a gain of 1890 points after finishing November with a gain of 1734 points. October ended with a gain of 3184 after closing September with a small gain of 228 points, after finishing August with a gain of 1485 points, following a small gain of 285 points gain in July, after closing June with a gain of 2683 points. May closed with a gain of 3205 points. April saw a gain of 3354 points while March closed with a gain of 6168 points. The Platinum Service made a record 9619 points last October. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1900 points. I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
Equities
The S&P 500 closed 0.61% higher at a price of 6086.
The Dow Jones Industrial Average closed 308 points higher for a 0.69% gain at a price of 45,014.
The NASDAQ 100 closed 1.24% higher at a price of 21,492.
The Stoxx Europe 600 Index closed 0.37% higher.
This morning, the MSCI Asia Pacific closed 0.4% higher.
This morning, the Nikkei closed 0.3% higher at a price of 39,395.
Currencies
The Bloomberg Dollar Spot Index closed 0.15% lower.
The Euro closed 0.05% higher at $1.0515.
The British Pound closed 0.2% higher at 1.2701.
The Japanese Yen fell 0.6% closing at $15052.
Bonds
Germany’s 10-year yield closed 2 basis points lower 2.04%.
Britain’s 10-year yield closed 2 basis points lower at 4.23%.
U.S.10 Year Treasury closed 3 basis points lower at 4.18%.
Commodities
West Texas Intermediate crude closed 1.69% lower at $68.76 a barrel.
Gold closed 0.2% higher at $2650 an ounce.
This morning on the Economic Front we have German, Euro-Zone and U.K. Construction PMI at 8.55 am, 9.00 am and 9.30 am respectively. Next, we have Euro-Zone Retail Sales at 10.00 am, followed by U.S. Weekly Jobless Claims and the Trade Balance at 1.30 pm. Finally, we have a speech from Fed Member Barkin at 4.30 pm.
Cash S&P 500
Wednesday was the third straight session where the S&P closed higher attended by either a negative or flat NYSE advance/decline ratio and more NYSE down volume than up volume. Breadth as shown by the McClellan Oscillator again fell with the MO closing with a small positive reading of +22 last night. This should not be happening with markets at all-time highs. The big question is anything going to derail this relentless move higher? The price action is telling you it is doubtful as the hype machine from bank analysts is also relentless. These analysts have been so wrong for the past two years yet are not held accountable. For example, JP Morgan had a year-end target level of 4200 for 2024 as stated in December 2023. Now, they have raised their year-end target level to 6300 on the back of ‘’Traders’ Math’’. You cannot make this stuff up. The entire intellectual integrity breakdown is something to behold especially with Bitcoin soaring over $100K overnight. With everyone long even a small reversal in the S&P and NDX has the potential to inflict serious damage as no one is prepared for this. Yesterday’s move higher saw the whole of my sell range triggered for a now 6078 average short position. Given the fact that I am short both the NDX and DAX I will now raise my T/P level on this position to 6070. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
EUR/USD
The Euro has been stuck in a 130-pont range between 1.0470 and 1.0600 for the past 10 days. This morning, the Euro is trading higher at 1.0540. This could be significant as the fall-out from the French Political crisis may now be priced into the Euro. I am still long the Euro at an average rate of 1.0665. Given how oversold the Euro I will continue to hold this position with no stop for now. I will leave my T/P level unchanged at 1.0690. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dollar Index
The Dollar traded in a narrow range yesterday and I am still flat. I will not chase the market higher as I continue to look to buy the Dollar on any dip lower to 105.00/105.70 with the same 104.35 ‘’Closing Stop’’. I still do not want to be short the Dollar at this time. If this view changes, I will be back with a new update for my Platinum Members. If I am taken long, I will have a T/P level at 106.10.
Cash DAX
The rally in the DAX is relentless as markets for now continue to ignore the growing political uncertainty in both Germany and France. The DAX is now living outside the top of its Daily Bollinger Band, closing yet again at a new all-time high. Retail continues to pile into the market on both sides of the Atlantic with no respect for valuations. Yesterday’s move higher saw the whole of my sell range triggered for a now 20210 average short position. I will leave my 20305 tight ‘’Closing Stop’’ unchanged while raising my T/P level to 21140. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Cash FTSE
I am still flat the FTSE as the market again traded in a narrow range as it tries to work off some of its overbought condition. This morning the FTSE is trading 20 points lower from where I marked prices 24 hours ago despite the fact that both the American Indexes and DAX closed at new all-time highs. I will now raise my buy level to 8210/8280 with a higher 8145 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 8330.
Dow Rolling Contract
The Dow Jones Utility Average has closed down for four consecutive days and is down over 4% since making a new high on November 27. The Dow Jones Transportation Average has closed down for five of the past six trading sessions and is down nearly 5% since making its high on November 25. Both Indexes have rally patterns that may be labelled complete. Meanwhile the Dow Jones gapped higher at yesterday’s open along with both the S&P and NDX but notably lagged the rally in the NDX in particular. If the Dow is able to continue its upward subdivisions, the next higher target surrounds the 45245 level. But given the negative price action in both the Utilities and Transport I am now on alert for a near-term decline. Today, I will be a small seller from 45200/45450 with a tight 45605 ‘’Closing Stop’’. The Dow has left an ‘’Open Gap’’ from November 22 at 44300 which may be filled before we move higher. As a result, I will continue to be a buyer on any dip lower to 44150/44400 with the same 43945 ‘’Closing Stop’’. If I am taken short, I will have a T/P level at 44980. If I am taken long, I will have a T/P level at 44580.
Cash NASDAQ 100
The NDX tagged on a further 1.25% yesterday as it led Wednesday’s gains, closing at yet another new all-time high. The NDX is now severely overbought with the 14 -Day RSI closing over 70. This move higher saw my second sell level at 21450 triggered for a now 21370 average short position. I will leave my 21605 ‘’Closing Stop’’ unchanged while raising my T/P level to 21300. With the number of open gaps below I would expect some retracement especially given the number of negative divergences prevailing at this time. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
March BUND
Thankfully the December Bund traded lower to my 134.80 T/P level on last week’s 134.90 short position, and I am now flat. I have now rolled to the March Contract which is trading at a 160-point premium to the December Contract. This morning, the March Bund is trading at a price of 136.90. We have short-term resistance from 137.40/138.10 where I will be a seller with a 138.85 tight ‘’Closing Stop’’. If triggered, I will have a T/P level at 136.80. With Yields at 2.04% I have no interest in buying the market at these levels. If this view changes, I will be back with a new update for my Platinum Members. will roll to March in the next few days.
Gold Rolling Contract
Gold continues to trade in a narrow range following its 3% fall last week. I am still flat. As I am still long Silver, I have no interest in chasing the price of Gold higher. Therefore, I will continue to be a buyer from 2575/2592 with the same 2559 ‘’Closing Stop’’. If triggered, I will have a T/P level at 2608.
Silver Rolling Contract
Silver traded in a narrow range yesterday and I am still flat. This morning Silver is trading 1% higher at a price of 31.42. I am still long at an average price of 32.20 with the same 32.60 T/P level. Meanwhile, I will also leave my 29.45 ‘’Closing Stop’’ unchanged. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Please Note: There will no Daily Commentary tomorrow. Any of my calls that are not triggered today and subsequently executed on Friday will see return with updated emails for my Platinum Members.
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